Correlation Between Oneconnect Financial and CSG Systems
Can any of the company-specific risk be diversified away by investing in both Oneconnect Financial and CSG Systems at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Oneconnect Financial and CSG Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oneconnect Financial Technology and CSG Systems International, you can compare the effects of market volatilities on Oneconnect Financial and CSG Systems and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Oneconnect Financial with a short position of CSG Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oneconnect Financial and CSG Systems.
Diversification Opportunities for Oneconnect Financial and CSG Systems
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Oneconnect and CSG is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Oneconnect Financial Technolog and CSG Systems International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSG Systems International and Oneconnect Financial is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Oneconnect Financial Technology are associated (or correlated) with CSG Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSG Systems International has no effect on the direction of Oneconnect Financial i.e., Oneconnect Financial and CSG Systems go up and down completely randomly.
Pair Corralation between Oneconnect Financial and CSG Systems
Given the investment horizon of 90 days Oneconnect Financial Technology is expected to generate 3.61 times more return on investment than CSG Systems. However, Oneconnect Financial is 3.61 times more volatile than CSG Systems International. It trades about 0.02 of its potential returns per unit of risk. CSG Systems International is currently generating about 0.03 per unit of risk. If you would invest 692.00 in Oneconnect Financial Technology on November 19, 2024 and sell it today you would lose (292.00) from holding Oneconnect Financial Technology or give up 42.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oneconnect Financial Technolog vs. CSG Systems International
Performance |
| Timeline |
| Oneconnect Financial |
| CSG Systems International |
Oneconnect Financial and CSG Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oneconnect Financial and CSG Systems
The main advantage of trading using opposite Oneconnect Financial and CSG Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oneconnect Financial position performs unexpectedly, CSG Systems can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in CSG Systems will offset losses from the drop in CSG Systems' long position.| Oneconnect Financial vs. Trust Stamp | Oneconnect Financial vs. Amesite Operating Co | Oneconnect Financial vs. My Size | Oneconnect Financial vs. Kingsoft Cloud Holdings |
| CSG Systems vs. NetScout Systems | CSG Systems vs. Consensus Cloud Solutions | CSG Systems vs. Evertec | CSG Systems vs. Lesaka Technologies |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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